21Shares Research Newsletter - Issue 44

Market Outlook

The crypto asset industry had its second poor week in line with global markets which have been hit by sustained fears from investors of the Coronavirus pandemic and its likely effect on trade and the economy. The top five crypto assets performed as follows: BTC (-7.69%), ETH (-12.55%), XRP (-11.11%), BCH (-10.42%), and LTC (-18.8%).

The average on-chain transaction volume for the top-five crypto assets is as follows: BTC ($1.84B), ETH ($459M), XRP ($163M), BCH ($101M), and LTC ($40.8M). On average the total daily on-chain transaction volume number was down from $2.84B to $2.60B.

Product Update - Amun Completes Rebranding of ETP Product Suite with The Launch of 21shares

Amun AG, the Swiss issuer of crypto Exchange Traded Products (ETPs), is pleased to inform investors of its change of name of the ETP line of products to 21Shares AG.

This name change occurred with immediate effect on 2 March 2020 and all Amun ETPs will now be traded under this new name on SIX Swiss Exchange. In addition, the website www.21shares.com is also now live.

The new brand name is a homage to the total maximum supply of Bitcoin, as only 21 million Bitcoin will ever be in circulation. It further reflects the progressive change made in implementing the corporate strategy to transform the company into a multi-project, multi-crypto business and to standardise its offering by streamlining access for investors into either the financial or in crypto markets.

Learn more here.

Podcast - What Is Dissident Tech?

In the final episode of this season of the Amun State of Crypto podcast, the team talks to Maya Zehavi, a well-known thinker and analyst within the industry, about the term "Dissident Tech". We touch on the role Bitcoin may play in authoritarian regimes, issues with Big Tech, and more.

Listen to the full episode on Spotify, Apple Podcasts, or Megaphone.

Listen here.

News - U.S. Sues to Tap Crypto Accounts Tied to North Korean Hack | Bloomberg

What Happened?

The U.S. sued to gain control of cryptocurrency accounts North Korea allegedly used to steal more than $250 million from Bitcoin and Ether exchanges in 2018 in a move that comes as Kim Jong Un’s regime launched one of its biggest military provocations in months. The suit filed in federal court in Washington on Monday seeks the forfeiture of 113 accounts. According to the complaint, the hackers used phishing emails containing malware to target the exchanges, which were located in South Korea and elsewhere.

Why Does It Matter?

It has been known and has always seemed plausible that states with limited access to global trade and finance, due to sanctions, would turn to Bitcoin as an alternative — this has been the case for Iran as well. It is likely the U.S. government will find it difficult to limit such activity given the permissionless nature of Bitcoin and the wider range of crypto asset exchanges that exist outside of the U.S. government's purview.

Stories like this are especially relevant to our recently released podcast on "Dissident Tech" which discussed the ability for technologies like Bitcoin to allow individuals and entities to avoid regulations, sanctions, and surveillance (for better or worse).

Learn more here.

News - Ripple Would Not Be Profitable Without Selling XRP, Says CEO Garlinghouse | The Block

What Happened?

Ripple CEO Brad Garlinghouse has indicated that XRP sales form a significant chunk of the company's profitability. "We would not be profitable or cash flow positive [without selling XRP]," Garlinghouse was quoted as saying in a Financial Times report published Friday. "Well XRP is one source. I don't know how to answer that because if you took away our software revenues, that would make us less profitable. If you took away all our XRP, that makes us less profitable. So I don't think about it as one thing," Garlinghouse added.

Why Does It Matter?

The quote from Garlinghouse is interesting given the historical controversy over the relationship between XRP and Ripple Labs, with some alleging that the company has a vested interest in the XRP crypto asset — despite the company denying creating XRP or having control over the network.

In general, Ripple Labs is one of many companies within the industry that have either created a token or have extremely close ties to the entity which created the token. It is compelling for such companies to rely on the sales of the token as a primary revenue source but such a strategy is undoubtedly unsustainable. Aside from the sustainability point, revenue generated by secondary market sales of tokens is likely to only draw further suspicion, as has been the case for Ripple Labs which is currently embroiled in a lawsuit over XRP.

Learn more here.